What are Google Ads (Google AdWords) and how do they work?What are Google Ads (Google AdWords) and how do they work?

What Are Google Ads?

Google Ads is Google’s advertising platform that allows businesses to display ads across multiple networks—including Google Search, YouTube, Gmail, the Google Display Network, and partner websites.

It operates primarily on a pay-per-click (PPC) model. That means you don’t pay unless someone clicks your ad. The platform gives you access to the world’s most popular search engine, letting you target people with real-time intent.

When someone searches for something related to your product or service, your ad has the chance to show at the top of the page—above organic search results. You’re not interrupting the user’s experience. You’re showing up exactly when they’re looking for a solution.

How Google Ads Actually Works

At its core, Google Ads is an auction system. But it’s not just about who pays the most. Google uses three primary metrics to decide whether and where your ad appears:

1. Your bid – how much you’re willing to pay per click

2. Ad quality (Quality Score) – based on your click-through rate, landing page relevance, and ad copy

3. Expected impact of ad extensions and formats

Google’s algorithm determines an Ad Rank, and that score dictates your ad’s position on the page.

Even if your competitor bids more, your ad can show above theirs if your quality score is better. That’s why good creative, targeting, and landing pages matter just as much as your budget.

Campaign Types You Can Run with Google Ads

You’re not limited to just text ads on search results. Google Ads offers several powerful formats:

1. Search Campaigns

Text-based ads that appear on the Google Search Engine Results Page (SERP) when users type specific queries.

2. Display Campaigns

Banner and image ads that appear across over 2 million websites and apps in Google’s Display Network.

3. Shopping Campaigns

Visual product listings that include price, reviews, and images, used primarily by eCommerce brands.

4. Video Campaigns

Ads that play before, during, or after YouTube videos. Great for top-of-funnel awareness or retargeting.

5. Performance Max

Google’s newest all-in-one campaign that uses automation to show your ads across all platforms—Search, Display, YouTube, Gmail, and Discover—with minimal manual setup.

6. App Campaigns

Optimised to drive mobile app installs and in-app actions.

The Google Ads Setup Flow

Here’s how most successful advertisers approach campaign setup:

1. Create a Google Ads Account
   Sign up at ads.google.com and connect your Google Analytics and Google Tag Manager for accurate tracking.

2. Choose a Goal
   Do you want website traffic, form submissions, calls, app installs, or sales? Google guides your campaign setup based on this.

3. Define Your Audience
   Segment by geography, age, gender, household income, device, interests, behavior, and custom intent.

4. Select Keywords
   Use the Keyword Planner tool to identify terms your target audience is actively searching. Focus on high-intent, commercially viable phrases.

5. Craft Ad Copy
   Strong headlines and descriptions that match user search intent. Add site links, callouts, and structured snippets to increase real estate.

6. Set Your Budget and Bidding Strategy
   Daily or monthly budgets, and bid strategies like:

   • Manual CPC

   • Maximize conversions

   • Target CPA

   • Target ROAS

7. Launch and Optimize
   Once live, monitor metrics like impressions, CTR, CPC, conversion rate, cost per conversion, and ROAS. Use A/B testing and negative keyword pruning to refine performance.

What’s a Good Budget to Start?

There’s no one-size-fits-all answer, but most businesses can start with $20–$50/day depending on their industry. For competitive industries like legal or insurance, cost per click (CPC) can range from $10 to $60. For eCommerce or service-based businesses, CPCs often fall between $1 and $5.

Start small, test aggressively, and scale what’s working.

Is Google Ads Only for Big Brands?

Not at all. In fact, it levels the playing field.

A local bakery, dental clinic, or B2B SaaS startup can compete alongside national brands as long as the targeting, offer, and landing page are aligned.

Google Ads is especially effective for:

• eCommerce brands with clear product-market fit

• Local service businesses (plumbers, gyms, salons)

• Professional services (legal, medical, accounting)

• Real estate agents

• Education and training providers

Common Mistakes Businesses Make with Google Ads

• Targeting too broadly: Without narrowing down by intent or geography, you’ll waste budget fast.

• Sending traffic to a weak landing page: Your ad can be great, but if the page doesn’t convert, you’re burning money.

• Not using conversion tracking: Without it, you’re flying blind. Always measure form submissions, calls, purchases, or whatever action you want.

• Ignoring match types and negative keywords: This leads to irrelevant clicks and poor performance.

• Letting automation run without strategy: Google’s AI is powerful, but it needs a strong structure to succeed.

Google Ads vs SEO: Should You Do Both?

Yes.

Think of Google Ads as your short-term growth engine, and SEO as the long game. Ads give you immediate visibility and measurable ROI. SEO builds authority and organic traffic over time. A well-balanced digital strategy uses both.

Final Thoughts

Google Ads is not “set and forget.” It’s a performance channel that demands testing, iteration, and constant learning. But when set up correctly, it can become the most efficient and scalable acquisition tool in your entire marketing stack.

Whether you’re just starting out or scaling a six-figure campaign, a well-structured Google Ads account—with clean tracking, smart bidding, and relevant messaging—can drive serious results.

Need Help Launching or Fixing Your Google Ads Campaign?

We’ve managed millions in ad spend for local businesses and eCommerce brands alike. Whether you’re struggling with poor ROAS, unclear structure, or just want to stop wasting money—we can help.

Let’s build it the right way.

→ [Request a Google Ads Audit or Campaign Plan]